Small farms not always successful

Nov 07, 2002

Small farms are not unsuccessful large farms, top USDA officials said recently at the National Small Farm Conference in Albuquerque, N.M. Instead, small-scale operators are entrepreneurs who fill a vital role in agriculture and lead the way in several specialty markets, despite limited resources.

“Small farms are the crucible of invention, a place that fosters independence and innovation,” said keynote speaker Lou Gallegos, USDA assistant secretary for administration. “We're here today to build a groundswell of ideas and energy that will improve the lot of small farmers,” he told about 500 agricultural educators, specialists, program managers and producers.

Small farms and ranches, which the USDA's Agricultural Statistics Service defines as operations with less than $250,000 in gross annual sales, make up almost 92.3 percent of all farms in the United States. Most small-scale farmers earn only about $23,000 in net cash income annually, since production costs absorb more than 80 percent of gross sales.

Small farms are family farms, Gallegos said. They have endured for centuries because small-scale farmers are the ultimate optimists, he said. In fact, small farms are at the forefront of new product development, accounting for most of the production in the organic and natural food markets, the fastest-growing sectors of the agricultural market in the United States today, he said.

However, the number of small-scale farms is shrinking as the little guys lose ground to large agricultural corporations.

“Nationally, we're losing about 50 small farms per day,” said conference co-chair Edmund Gomez, executive director of New Mexico State University's Cooperative Extension Service's Rural Agricultural Improvement and Public Affairs Project. Some 300,000 farms disappeared between 1978 and 1998, according to a national report.

Small farms need attention from the federal government and at the state level, said Colien Hefferan, administrator of USDA's Cooperative State Research, Education and Extension Service. “They (small-scale farmers) have special research, education and Extension needs because they have fewer resources available to them than larger farms.”

She said the federal government and state Cooperative Extension services must play a role in answering pressing issues of global competitiveness, proprietary biotechnology products and changes in rules for organic crop production.

While research and Extension budgets have not grown significantly at the federal level and many states are experiencing enormous financial shortfalls, the small farm audience is large and growing, she said.

In a blunt address, Paul Gutierrez, executive director of USDA's Farm Service Agency in New Mexico, said the credo in agriculture today is “get big, get specialized or get out.”

It is in the specialized sector where America's small farm operations can find a profitable niche, he said, especially if federal government can move toward reducing regulatory burdens and make the loan process more accessible for small farmers.

While the nation primarily relies on large farms for its food and fiber, small farms do fill an agricultural niche in producing specialty products like oilseed and grain crops, as well in small-scale cattle production, said Doris Newton, economist with USDA's Economic Research Service in Washington.

Meanwhile, large-scale operations are super-sizing. For example, in 1980, four firms controlled 36 percent of beef slaughter nationally. By 1998, those same four firms controlled nearly 82 percent of production.

Several speakers during said there is a need for small farmers to be more competitive on a global basis, which could lead Extension programs to focus on value-added products, new uses for agricultural commodities, and a systems approach to research and Extension programs.

The shift would mean focusing on issues rather than scientific disciplines and looking at the farm unit as a food, feed and fiber production system, rather than as an isolated set of production issues.

Gallegos and other USDA officials effectively summed up the size of the contributions small farms make in the United States. Small farms enhance the quality of life for all Americans and protect natural resources for the entire nation, he said.

About one-third of the nation's 946 million acres of farmland belongs to small farmers.

In New Mexico, small farms account for about 94 percent of the state's 15,200 farms, according to the latest available USDA agricultural census. But 82 percent of the state's farms earn less than $50,000 in gross annual sales, and three-fourths of those earn less than $10,000.